REG completes acquisition of Dynamic Fuels

REG Synthetic Fuels, a wholly owned subsidiary of North American advanced biofuels producer Renewable Energy Group (REG), has acquired the remaining 50% ownership interest in Dynamic Fuels, previously owned by Tyson Foods.

The following the closing of its purchase of substantially all of the assets of Syntroleum and the closing of this transaction with Tyson, REG now takes full ownership of Dynamic Fuels' 75 million gallon renewable diesel biorefinery in Geismar, Louisiana.

Tyson and Syntroleum formed Dynamic Fuels in 2007 as a 50/50 joint venture. Completed in 2010, the facility, which was the first large-scale renewable diesel biorefinery to be built in the US, will now be known as REG Geismar.

'Closing these transactions enables our entry into the renewable diesel market in a significant way,' says Daniel J. Oh, president and CEO of REG.

REG paid Tyson approximately $16.5 million (€12 million) in cash at closing and retired approximately $13.5 million of Dynamic Fuels' indebtedness to Tyson. REG has also agreed to make up to $35 million in future payments to Tyson tied to product volumes at the Geismar biorefinery over a period of up to 11.5 years. REG intends to use proceeds from its recent $143,750,000 convertible senior notes offering to either replace the letter of credit that Tyson Foods obtained to support the biorefinery's $100 million in Gulf Opportunity Zone Bonds, issued through the Louisiana Public Facilities Authority, or to redeem these bonds.

Most of the employees at Dynamic Fuels, LLC are expected to join the company as part of the renamed REG Geismar.